ESRS E1 is the European Sustainability Reporting Standard covering climate change. It is the most detailed of the twelve sector-agnostic topical ESRS standards and the one that, for most European industrial and logistics companies, will drive the greatest share of data collection effort in the first CSRD reporting cycle. ESRS E1 contains nine sub-requirements — E1-1 through E1-9 — each specifying disclosure requirements and their associated quantitative and qualitative data points.
This guide maps each ESRS E1 sub-requirement to the underlying source data it draws on, identifies the most common preparedness gaps, and flags where software-based data collection can close the gap versus where human judgment is irreplaceable.
E1-1: Transition Plan for Climate Change Mitigation
E1-1 requires disclosure of the company's transition plan for climate change mitigation — the strategy for aligning the business with a 1.5°C pathway. This is a qualitative governance-level disclosure covering: how the board oversees climate strategy, whether the transition plan has been approved at board level, key assumptions underpinning the plan, and how it connects to the company's financial plan and capital allocation.
The source data for E1-1 comes primarily from internal governance documents: board minutes, investment committee decisions, strategy papers, and any scenario analysis exercises (aligned to IPCC pathways or IEA Net Zero scenarios). This is a disclosure area where the honest assessment for many mid-caps in their first reporting year is: "We have a commitment to climate targets but not a formalised transition plan with capital allocation attached." The ESRS allows companies to disclose that the transition plan is in development, provided they specify the timeline for completion — it does not require a fully elaborated plan in Year 1. That transparency is more consistent with the spirit of the regulation than publishing a vague plan that does not hold up under auditor scrutiny.
E1-2 and E1-3: Policies and Actions
E1-2 requires disclosure of policies that address climate change adaptation and mitigation. E1-3 requires disclosure of the material actions taken during the reporting period to implement those policies, along with the associated resources (opex and capex).
The challenge here is precision. A policy statement like "We are committed to reducing emissions in line with the Paris Agreement" does not meet the ESRS E1-2 disclosure requirement, which asks for: the scope of the policy (which activities and parts of the value chain it covers), whether the policy applies to the company's own operations only or also to the value chain, and how the policy is implemented and monitored. The source data is internal policy documentation, and for most companies this means either drafting new climate policy documents for the first time or substantively upgrading existing ones before the filing date.
E1-4: Climate Change Targets
E1-4 requires disclosure of GHG emission reduction targets — mandatory if climate is assessed as material in the double materiality assessment, which for most industrial companies it will be. The disclosure must include: the base year, the target year, the scope covered (Scope 1, 2, 3 separately or combined), the percentage reduction committed, and whether the target has been validated by an external body (e.g., Science Based Targets initiative validation, though this is not mandatory under ESRS).
Source data: the base year GHG inventory, which must be calculated first before a meaningful percentage reduction target can be set. This is why the base year emissions calculation — particularly for Scope 3 — is the critical precursor to E1-4 disclosure. A company that does not have a completed Scope 1, 2, and material Scope 3 inventory for their base year cannot produce a credible E1-4 disclosure. This sequencing dependency is frequently underestimated in CSRD preparation timelines.
E1-5: Energy Consumption and Mix
E1-5 requires quantitative disclosure of total energy consumption (in MWh or GJ), broken down by renewable and non-renewable sources, and by energy type (electricity, heating/cooling from a network, self-generated from fuels). For companies that have purchased renewable energy certificates (RECs/GOs), E1-5 must distinguish between consumption with and without the renewable energy attribute claim.
Source data: electricity invoices (kWh consumed per period, with network information to identify the grid emission factor), natural gas and heating oil invoices (volume in m³ or litres, converted to MWh using standard calorific value factors), district heating invoices (MWh delivered), and any on-site renewable generation (solar PV metering data).
Companies with multiple sites across different countries need to consolidate energy data from all sites. For a manufacturer with 12 production and logistics facilities across Germany, Poland, and France, this means collecting invoices from multiple utility providers in different billing formats — a task that is manageable when automated but time-consuming when done manually. The E1-5 data also feeds directly into the Scope 2 GHG calculation, making energy data accuracy doubly important.
E1-6: Gross Scope 1, 2, and 3 GHG Emissions
E1-6 is the core quantitative GHG disclosure. It requires:
- Scope 1: Total direct GHG emissions in tCO₂e, covering combustion of fuels, process emissions, and fugitive emissions. Broken down by GHG type (CO₂, CH₄, N₂O, HFCs, PFCs, SF₆, NF₃) if material.
- Scope 2 (location-based): Indirect emissions from purchased electricity, heat, steam, cooling — calculated using grid average emission factors for the country/region of consumption (e.g., the German electricity grid average of approximately 380–420 g CO₂e/kWh in recent years).
- Scope 2 (market-based): Same calculation but using supplier-specific or contractual emission factors. If the company has Power Purchase Agreements or has purchased Guarantees of Origin that are unbundled from a renewable energy supplier, the market-based figure reflects this.
- Scope 3: Total indirect emissions across all material categories. ESRS E1-6 requires that each material Scope 3 category be disclosed separately, with the method used (spend-based, activity-based, or supplier-specific) and the emission factor source identified.
Consider how this plays out for a company like Veltmann Industrials GmbH. Their FY2024 preliminary inventory: Scope 1 — 4,340 tCO₂e (natural gas combustion: 3,870, company vehicle fleet: 470); Scope 2 location-based — 2,110 tCO₂e; Scope 2 market-based — 380 tCO₂e (partial PPA for renewable electricity); Scope 3 Category 1 — 43,200 tCO₂e (spend-based, year 1 estimate); Category 4 — 8,600 tCO₂e; Category 6 — 510 tCO₂e. Total Scope 3: approximately 56,000 tCO₂e, meaning Scope 3 represents roughly 91% of the combined Scope 1+2+3 footprint. This ratio — Scope 3 dominating the total — is typical for manufacturers that have already addressed the easier Scope 1 and 2 reductions through energy efficiency and renewable energy procurement.
E1-7 Through E1-9: Removals, Financing, and Internal Carbon Pricing
E1-7 covers GHG removals and carbon credits used against net emission claims. ESRS E1-7 is explicit that gross emissions must be disclosed separately from any removal or credit claims — a company cannot simply report a "net zero" figure without disclosing the underlying gross emissions. If the company uses carbon credits (verified or otherwise) to claim net reductions, those must be separately disclosed with information on the project type, registry, and vintage year.
E1-8 requires disclosure of the potential financial effects of physical and transition climate risks on the company's financial position. This disclosure connects to the scenario analysis required under E1-2 and asks for quantitative or semi-quantitative estimates of financial exposure — for example, estimated additional energy costs from carbon pricing under a 2°C vs. 1.5°C scenario, or estimated costs of physical damage to facilities under a Representative Concentration Pathway (RCP) 4.5 scenario.
E1-9 covers internal carbon pricing — whether the company applies an internal shadow carbon price in investment decisions, and if so, the price level and how it is applied. Many European industrial companies have adopted internal carbon prices (commonly in the €50–€150/tCO₂e range) for investment evaluation. This is now a mandatory disclosure under ESRS E1 if the mechanism exists, though companies without a formal internal carbon pricing mechanism simply disclose that one is not in place.
On the Relationship Between Data Quality and Assurance Scope
We're not saying that perfect data quality is a prerequisite for a first CSRD filing. ESRS allows the use of estimates and proxies, and auditors performing limited assurance understand that Year 1 inventories will include spend-based Scope 3 estimates. What changes under limited assurance compared to voluntary reporting is that the methodology choices — why a particular emission factor was selected, how boundary decisions were made, which suppliers were included and excluded from Category 1 — must be documented and defensible. The quality bar is not "perfect data" but "documented, consistent, and methodologically grounded data."
Author: Fabian Richter, CEO & Co-Founder, CarbSynq. Published .